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Tax liability accumulating on wage subsidy scheme
Law Society president Michele O'Boyle

29 Apr 2020 / Law Society Print

Tax liability accumulating on wage subsidy scheme

Law Society President Michele O’Boyle has said in a bulletin to the profession that despite the extraordinary challenges posed by COVID-19, many solicitors continue to conduct their business and represent their clients, while adhering to the WHO guidelines.

Impediment

Where a surmountable impediment to essential legal business can be addressed without compromising public health, the President will continue to lobby to overcome that impediment.

Following recent representations, Revenue has relaxed rules governing the Temporary Wage Subsidy Scheme so that employers who missed the March deadline to file payroll information can now access this important support.

This is subject to a number of conditions outlined on the Revenue website.

However, employees should be aware that tax liability may be accumulating on payments under the Scheme.

Deducted

The subsidy given to employees is subject to tax depending on income, but this is not currently deducted using the normal PAYE system.

Tax on the subsidy will be paid at a future date to be outlined by Revenue.

The Support Services section of the Law Society has produced a briefing on the Scheme as it currently stands.

Many solicitors previously unable to access the COVID-19 Pandemic Unemployment Payment may now be eligible following Law Society representations.

Initially, only those who had ‘ceased to trade’ could apply.

Concerns

Law Society President Michele O’Boyle wrote to the Minister for Employment Affairs and Social Protection, Regina Doherty, setting out concerns on this point.

The rules have since significantly changed.

The Department of Employment Affairs and Social Protection now advises as follows: "You may, if your trading income has collapsed to the extent that you are available to take up other full-time employment if it was offered to you, receive a payment of €350 per week for so long as you are available to take up other work."

Many self-employed solicitors have now applied for and received a payment.

More information on the initiative is available on the Gov.ie website.

Any self-employed solicitor who wants information on this scheme should contact Small Practice Support at the Law Society without delay.

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